The modern budget is based on what is going to be done, that is, on objectives and goals, which establishes that annual operating plans or work plans must be prepared, and the budget as a financial expression of the programmed action or plans. annual operations.
It can be said then that it gives emphasis to what is going to be done, for which reason it is based mainly on the determination of objectives and goals and establishes the administration criteria by objectives, by associating the objectives with the functional areas and establishing those responsible for their compliance.
The modern budget is a results-oriented program budget.
The program budget system is a very useful instrument for better public sector action, and it has not been used to its full potential. It is convenient to clarify that as systems there are only the traditional budget system and the program budget system. The zero-based budget and the results-based budget are not systems, but rather methodologies or mechanisms, in the case of the zero-base to formulate a budget and in the case of the results-based budget, what is intended is a program budgeting process in which:
“The formulation of the programs revolves around a series of defined objectives and anticipated results. The expected results must justify the resource needs that are due and linked to the products necessary to achieve those results. ” and can be applied in the program budget.
The modern budget is highly participatory, so it must be carried out in a decentralized way, that is, those in charge of the executing units, I mean those responsible for the programs, areas, units and projects, must formulate, execute and control their plan. budget. The foregoing bearing in mind that there must be units that coordinate and advise throughout the plan-budget formulation process and in the other stages of the budget process. It is essential that there is broad participation and commitment from all hierarchical and functional levels for the achievement of the Entity's objectives and goals, so that each official feels motivated and participates in a process that produces results for society.
It is important to remember that if the officials are given broad participation in the definition of the objectives and goals, a greater commitment can be obtained to achieve them and the path towards the fulfillment of the organization's purpose, that is, the Mission, it becomes clearer and clearer. It should be borne in mind that if you have a modern budget, you will have a political tool and a planning and administration instrument that helps to improve institutional actions and to achieve the objectives and goals with efficiency, effectiveness, economy and quality.
The plan-budget is a system that takes into account the criteria of the officials, experience and common sense, since this tool, although it has very much in mind the economic and financial aspects, considers human resources as a fundamental factor, and therefore it does not lead to a single alternative.On the contrary, in the decision-making process, it enables several alternatives. It should be borne in mind that the plan-budget system is part of another system, that of the respective organization or entity, and both are immersed in a larger system, be it the public or private sector, as appropriate. Likewise, the plan-budget is a system that is linked and closely related to other administrative systems such as decision-making, information, human resources, and financial administration.
A fundamental element of the modern budget is the annual operating plan, which can be defined as: «The instrument formulated in accordance with the medium and long-term plans, which establishes the entity's policy, determines general and specific objectives, goals, cost of goals and actions to be carried out during the respective year, keys to success and the values in order to have some minimum indications for the medium term, to guide action in the short term.
One of the most important roles of the modern plan-budget is to serve as an instrument to measure and evaluate, in terms of the goods and services provided, the results of administrative activity. To measure the results, it is essential to have units of measurement that clearly show the things done or the final products of the activity of the entity or companies such as the kilometers of cart built, patients served and hectares of land reforested.
In the modern budget, the determination of final products is essential, but it is also a limiting factor, because it is not always easy to measure the activities carried out by institutions and companies.
In a seminar that participated in Guatemala on budgetary evaluation it was indicated: “That the technique of Program Budget is a technique that is in force as long as the budget is an instrument for meeting objectives and goals to express the products that meet the needs of the society and the technical call of the Budgeting for Results is a synthetic name that does not manifest the comprehensiveness of the budgeting process since to reach the results, techniques and processes that are already perfectly typified and developed theoretically and practically in the techniques of the Program Budget must be used. In the case of results-based budgeting, what is intended is a program budgeting process in which:“The formulation of the programs revolves around a series of defined objectives and anticipated results.
The expected results must justify the resource needs that are due and linked to the products necessary to achieve those results. ” It is convenient to apply elements of the budget for programs focused on results considering that the Budget for Results has the purpose of "Strengthening the effectiveness, efficiency, quality and equity of public spending, to contribute to a better performance of the state with respect to the well-being of the population, in particular, of the poor and excluded ”. Which considers people and their well-being at the center of state action. It is therefore about improving the performance of the state in the areas that have the greatest impact on the well-being of the population.
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Lic Bernal Monge Pacheco
